Israel, Rice Report Big Increase in Credit Report Errors

Both are asking for action to fix errors, protect tax identity theft.

Rep. Steve Israel, D-Huntington, and Nassau County District Attorney Kathleen Rice say there has been a sharp increase in credit report errors and tax identity theft. 

In a press conference at the Bethpage Federal Credit Union Friday, Israel and Rice offered tips to keep consumers safee during tax season. According to a recent study, one in four had at least one potentially material error. Also, in the first nine months of 2012 alone, the IRS identified almost 642,000 incidents of tax identity theft.

“The prevalence of credit report errors and tax identity theft is staggering," Israel said. "While many believe that it could never happen to them, the statistics show otherwise."

Israel and urged local residents to be aware and take steps to reduce their risk.

"I am also calling on the Consumer Financial Protection Bureau to protect the people they serve by ensuring credit bureaus work with consumers to fix errors in their credit reports,” Israel said.

Rice said her office is dedicating "significant resources" to investigating and prosecuting these crimes.

“In Nassau County and across the county, con artists are harvesting personal information from a variety of sources to steal tax refunds," Rice said. "To avoid becoming a victim, it’s essential that people safeguard their personal information and regularly check their credit reports."

Credit report errors have been rising steadily, according to a recent study by the Federal Trade Commission. Twenty-six percent of people in the study, representing as many as 40 million people in the United States, had at least one potentially material error and 5.2 percent of study participants had errors which, once corrected, resulted in an increased credit score high enough to decrease their credit risk and make them more likely to receive better loans. 

In addition, there has been a significant increase in tax identity theft. A report issued by the Treasury Inspector General for Tax Administration estimated that the IRS could issue $21 billion in fraudulent tax refunds over the next five years. According to the IRS, identity thieves use a taxpayer's identity to fraudulently file a tax return and claim the victim’s refund.

For tips on what to do if you find an error in your credit report, click here.

For tips on how to prevent identity theft, especially as you file your taxes, click here.


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